Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Mad) 2199

IN THE HIGH COURT OF JUDICATURE AT MADRAS
A.D. MARIA CLETE, J.
TASMAC Oozhiyar Manila Sammelanam (CITU) Reg.No. 3239/CNI, Rep. by its General Secretary – Petitioner
Versus
The Government of Tamilnadu, Rep. by its Principal Secretary, Labour and Employment Department and Ors. – Respondents
W.P. No. 150 of 2020 and W.M.P.Nos. 188, 190 of 2020 and 33861 of 2023
Decided On : 29-04-2025

Advocates Appeared:
For the Petitioner:Mr. V.Ajoy Khose, Advocate
For the Respondents:Mr. R. Kumaravel, AGP, Mr. P.S. Raman, Advocate General assisted by Mr.K.Sathish Kumar.

The Industrial Employment (Standing Orders) Act, 1946 applies to TASMAC, mandating certification of Standing Orders or adoption of Model Standing Orders, and prohibits unilateral changes in disciplinary rules without compliance with statutory requirements.

Headnote:
(A) Industrial Employment (Standing Orders) Act, 1946 - Sections 3, 12A, and 9A - Tamil Nadu Shops and Establishments Act, 1947 - Applicability to TASMAC - The court held that the Industrial Employment (Standing Orders) Act applies to TASMAC, requiring it to certify its Standing Orders or adopt Model Standing Orders. The court emphasized that TASMAC's unilateral introduction of the 2014 Code without compliance with statutory requirements is invalid. (Paras 1, 3, 4, 12, 124)

(B) Disciplinary Action - The court reiterated that any disciplinary action must adhere to the principles of natural justice and the provisions of the Industrial Employment (Standing Orders) Act. The introduction of new rules of discipline without notice is impermissible. (Paras 9, 11, 12, 130)

(C) Judicial Precedents - The court noted that TASMAC has consistently disregarded binding judicial precedents regarding employee rights and the application of labor laws. (Paras 88, 124)

(D) Costs - The court imposed a cost of Rs. 1,00,000 on TASMAC for its persistent non-compliance with labor laws and judicial directions. (Paras 139, 140)

JUDGMENT :

(A.D. MARIA CLETE, J.)

“The slaves are ours:' so do I answer you:

The pound of flesh, which I demand of him, Is dearly bought; 'tis mine and I will have it.

If you deny me, fie upon your law!

There is no force in the decrees of Venice.

I stand for judgment: answer; shall I have it?

1. Act 4 Scene 1, The Merchant of Venice

Williams Shakespeare

In The Merchant of Venice, Shakespeare portrays Shylock, standing before the court of Venice, insisting that Antonio’s bond be strictly enforced, despite appeals from the Duke and others for leniency. His steadfast demand for literal enforcement of the bond — ignoring broader notions of fairness and equity —resonates even today.

If that portrayal were to find a parallel in the present case, it would be in the stance adopted by the second respondent, the Tamil Nadu State Marketing Corporation Ltd. (TASMAC), which similarly seeks to insist on rigid positions in disregard of broader legal and equitable obligations.

2. If there is one entity today to which this critique squarely applies, it is the 2^nd Respondent – the Tamil Nadu State Marketing Corporation Limited (TASMAC). Established as a Government company in 1983 during the tenure of the then Chief Minister, Thiru M.G. Ramachandran, TASMAC was originally envisioned as a regulatory mechanism to oversee liquor sales and to curb the menace of illicit liquor. It has grown into a Leviathan and is attempting to ward off any legal control of any laws. Bolstered by the substantial revenue it generates, TASMAC appears to be resisting the applicability of general legal norms, routinely disregarding binding judicial precedents and treating court directives with evident indifference. This judgment would simultaneously examine the manner in which this Court’s orders concerning TASMAC employees and the application of labour laws have been repeatedly disregarded by the Corporation—conduct which, if not outright contemptuous, certainly verges on it.

3. Before dealing into the labour legislations applicable to TASMAC, it is apposite to trace the historical context of prohibition in this State. The Prohibition Act, 1937 was enacted during the premiership of Shri C. Rajagopalachari (Rajaji) in the erstwhile Madras Presidency. The legislative intent behind this enactment was the enforcement of total prohibition, notwithstanding the significant fiscal implications arising from the loss of excise revenue. The Act was not merely a symbolic gesture; it was brought into force, notably in the district of Salem, which happened to be Rajaji’s native place. At the time of the drafting of the Constitution, there was a concerted attempt to implement prohibition at the national level. Though total prohibition across the country was found to be impracticable then, the intent was nevertheless crystallised in the form of Article 47 of the Constitution, which was placed among the Directive Principles of State Policy. The said Article enjoins the State to endeavour to bring about prohibition, and it reads as follows:–

“The State shall regard the raising of the level of nutrition and the standard of living of its people and the improvement of public health as among its primary duties and, in particular, the State shall endeavour to bring about prohibition of the consumption except for medicinal purposes of intoxicating drinks and of drugs which are injurious to health.”

4. Between 1971 and 1991, spanning two decades under the leadership of two different Chief Ministers—Thiru M. Karunanidhi and Thiru M.G. Ramachandran—partial prohibition was implemented on three separate occasions: from 1971 to 1974, 1981 to 1987, and again from 1990 to 1991. These intermittent policy shifts elicited mixed reactions from the public. Ultimately, however, the State moved away from the idea of prohibition, and by the year 2001, it was completely lifted. Commencing with the financial year 2001–2002, the State resorted to auctioning licenses for retail vending of Indian Made Foreign Liquor (IMFL), inc